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Handheld Computers
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Four years ago Palm created the first successful PDA. Today it holds an 80% share of the market for handheld computers. Its most serious competition is a family of devices from various vendors based on the Windows CE operating system. In some ways the competition between these two systems is reminiscent of the earlier Macintosh-Windows battle. Users become familiar with a device and develop strong preferences.

Operating System
The Palm OS was originally designed for a device with 512K of memory and no hard disk. Subsequent models doubled and redoubled available memory until the current generations of devices (IIIxe, Vx, IIIc) have 8M RAM at the same or lower prices than the original model. Although the Palm OS was modified to allow use of larger memory, it retains its original base architecture and processing speed. It is almost impossible for an ordinary user to use anywhere near the full 8M. Windows CE is a scaled down version of the Windows 9x operating system. Just booting the system seems to use up 3M of the RAM, and with Pocket versions of Word, Excel, IE, and (in some models) Access it is fairly simple to fill a typical 16 or 32M systems. CE devices typically have a slot for a plug in "Compact Flash card".

The most common use for the card is to add 32 to 128M of non-volatile memory to hold large files as an alternative to disk storage. Although CE appears to be big and sloppy, it is not architecturally constrained by a small memory design. Early versions of CE were unsuccessful because the hardware had not caught up with the design. Today the available processor and memory technology can support CE competitively with Palm. In subsequent generations of technology, CE may be more flexibly designed to take advantage of additional power. Until recently, a Palm system cost $300 to $450 while CE systems typically cost $600 to $800.

Today, however, the street price of the high end 8M Palm Vx or IIIc ($400 to $450) is in the same general area as the HP Jornada 540 (16M $420), the Compaq H3650 (32M $470), or the Casiopeia 115 (32M $530). Palm has allowed its operating system to be used on "clone" devices like the Handspring PDA. However, the supported hardware has been tightly controlled. This allowed the operating system to remain small, tight, and lean. The screens have 160x160 pixels although subsequent models and versions of the OS have supported progressively deeper levels of gray and now color. Since all data is held in memory, Palm doesn't need to support any type of disk devices. All communication is based on some type of serial communication (direct to the PC, over IR, or through a modem).

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